Previous approaches to delivering skills have been too supply driven based on the Government planning supply to meet ineffectively articulated employer demand...The Review recommends a fully demand-led approach.

Lord Leitch also said that planning should not be done by bodies such as the Learning and Skills Council.

Lord Leitchs report identifies that there should not be the level of top-down planning that the system currently faces. Sir Andrew Fosters report identifies the burden of regulation on the FE sector. But the Bill does nothing to tackle those challenges contained in reports that the Government have commissioned.

In the Queens Speech debate, the Secretary of State, I regret, made a virtue of the fact that the Bill does not engage with Lord Leitch, saying

We do not see a need to wait for Leitch before the Bill. Indeed, we think that Leitchs report will make such radical proposals that there will need to be a further period of consultation. I doubt very much whether there is anything in Leitch that will necessitate our changing the Bill[ Official Report, 16 November 2006; Vol. 453, c.251.]

As so often, there are big issues about the future of skills in our country that the Government have failed to tackle and they have missed the legislative opportunity to do so. Instead, we have far too much fiddling around and reorganising, exactly the kind of things that Governments do when they do not really know what to do at all; displacement activity. In fact, we have the fourth reorganisation of the Learning and Skills Council in as many years. It was established only in 2000. In January 2004, there was the creation of a new regional management team with the appointment of 10 regional directors. We had a reorganisation around two directorates, with three directorates being closed down and further reorganisations in 2004 and 2005.

As we have heard from Labour Members, and as a result of parliamentary questions from myself and others, the Learning and Skills Council has incurred redundancy costs of £54 million associated with the various reorganisations in the six years since it was created. If you add on the £62 million of costs from closing the training and enterprise councils that we created, £120 million has already been spent simply on reorganising various skills bodies in this country. That £120 million could have paid for an extra 32,000 apprenticeship places. We are far from convinced that we need another regional reorganisation.

Mr. Tim Boswell (Daventry) (Con):
Does my right hon. Friend recall that when the Learning and Skills 21 May 2007 : Column 1005
Council was introduced, we were promised annual savings of the order of £50 million? What happened to those savings? Does he think that that is an awful precedent for what is promised now?

Mr. Willetts:
My hon. Friend has made a good point. I was worried when the Secretary of State had to resort to describing all those extraordinary costs as investments. It is a funny investment for an organisation that is supposed to be committed to high standards in skills and training to spend £120 million on redundancy and administrative change.

Everyone on Jobseekers Allowance will be assessed for their skills and...attend a mandatory skills course.?

And is he surprised, like me, that nothing has happened?

Mr. Willetts:
My hon. Friend, who follows those matters very closely, has made an excellent point. When we hear an announcement on the Today programme, we all know that nothing will actually happen in the real worldas so many people know, that is all too often the case.

There has been a great deal of expenditure on reorganising the learning and skills councils. In the Bill as originally draftedwe have heard that sadly these provisions will return in some formthere were powers over FE colleges, particularly with regard to the position of principals at FE colleges. I invite the Secretary of State to recognise that the creation of those bodies as corporationslegally free-standing bodieswas supposed to mean something real. It was supposed to mean that they would be masters of their own destinies. I had the privilege of sitting on the corporation at Havant college for several years after incorporation, and we regarded ourselves on the governing body as being responsible for running that college, including having responsibility for the appointment of the principal of the college. It is simply not possible on the one hand to announce that those bodies are supported as free-standing corporate bodies and on the other take the power to allow the Secretary of State to remove the principal. That is completely inconsistent with those bodies being free-standing corporations, and we think that that is a failure to grasp the real powers that those bodies have enjoyed since 1993.

Kelvin Hopkins:
I seem to remember that in the era of the hon. Gentlemans Government, many colleges were found to be financially incompetent, but nothing was done about them. It was only when this Government took over that we started to clear up the mess left by the previous Government.

Mr. Willetts:
I recognise that colleges sometimes have those problems, but when we established the legislation in 1992, there was a clear legal framework about who was responsible for what. The Secretary of State is in danger of dividing responsibility between the 21 May 2007 : Column 1006
governing body of the corporation, which is supposed to take legal responsibility for the college, and the Secretary of State and the Department for Education and Skills. Each will blame the other, which is a recipe for the type of problems that the hon. Member for Luton, North (Kelvin Hopkins) has referred to, which happened in the past and which, I fear, will recur again.

Dr. Julian Lewis (New Forest, East) (Con):
Ms Di Roberts is the principal of Brockenhurst college, which is an outstanding college in my constituency. She has contacted me on that particular point to say that there could be severe legal difficulties if someone who had been dismissed not by the governors but by a third party were to mount a legal challenge. Furthermore, governors might themselves be deterred from dismissing someone who ought to be dismissed, because they would erroneously believe that it was probably safer to rely on the LSC to do the dirty work for them.

Mr. Willetts:
My hon. Friend is absolutely right. I want to hear whether the Secretary of State agrees with paragraph 7.39 of his Governments own White Paper:

A college, led by its governing body, is responsible for determining its own mission, managing its own affairs, meeting its statutory responsibilities and improving its own performance.

We accept that definition of the role of a college. If that is how a college is to be run and how the corporation functions, how on earth is that consistent with taking that strange power to intervene? That is inconsistent with the Governments own statement about how they see a college. Concern has been expressed by many principals and others involved in further education. The Association of Colleges says:

The appointment or dismissal of a principal are amongst the most important decisions a governing body has to take. The intervention of a third-party into the relationship between a governing body and a principal would have made it more difficult for governors to take action, particularly as this might create grounds for an individual to argue they have been unfairly dismissed.

That was the crucial point made by my hon. Friend the Member for New Forest, East (Dr. Lewis), which has not been dealt with by the Secretary of State. We will look with a beady eye at the proposals that he says he will bring forward during further consideration of the Bill.

Another feature of the Bill that has generated controversyfor such a short Bill, it has got Ministers into one or two scrapes in the other placeis the power for FE colleges to award degrees. It is odd that that was not seriously proposed in the White Paper. One of these days we will discover the origins of the proposalwhere it came from and when. It suddenly appeared very late in the day, although the Minister has done a great job of providing a retrospective justification for it. We do not object in principle to FE colleges having powers to award degrees, but there are still serious concerns about how it is to be done. As Members on both sides of the House have argued, it would be a tragedy if the new powers had the perverse effect not of strengthening progression from FE into higher education but of reducing the number of opportunities that FE students have to progress from FE to HE. Paradoxically, many universities are worried 21 May 2007 : Column 1007
that as a result of these provisions fewer students will come to them from FE. What assurances can Ministers give us on that point?

Dr. Roberta Blackman-Woods (City of Durham) (Lab):
Does the hon. Gentleman accept that foundation degrees should be seen as free-standing qualifications in their own right, and that one possible disbenefit of the strong link with universities is that they are seen as being a stepping stone to university instead of a route into employment or further training?

Mr. Willetts:
In saying that we accept that FE colleges should have degree-awarding powers, I meant that I recognise that it should be possible for an FE college to provide such a course on its own if it is of sufficient rigour to warrant a degree. However, we want to hear a bit more from Ministers about how they are going to ensure that progression is not threatened. We also want to hear more about the status of the degree. We can all take pride in the fact that British university degrees are internationally recognised and valued. As we know from briefings from organisations such as the British Council, they are something that students around the world wish to secure. It is important that we do not do anything that damages the prestige and value that attaches to a degree from a British educational institution, be it FE or HE.

My hon. Friends and I have received a letter from the Minister for Higher Education and Lifelong Learning. We welcome the concessions that he has made and appreciate that he has already moved significantly from the original proposals in the Bill in the light of debate in another place, as well as the extraordinarily constructive and statesmanlike role played by the shadow Ministers for further education and for higher educationmy hon. Friends the Members for South Holland and The Deepings (Mr. Hayes) and for Henley (Mr. Johnson)who have put country before party in a remarkable way. The documents that the Minister sent provided us with some reassurance, but we still need to know more about how he is going to take forward the assurances given by Lord Adonis that the safeguards on progression will be put on to a statutory footing by way of a Government amendment. We greatly look forward to studying that.

We have heard the Governments bold rhetoric, read the extraordinary reports of Sir Andrew Foster and Lord Leitch yet we have a Bill that tries to reorganise the Learning and Skills Council, intervenes unnecessarily in the powers of appointment of a principal and changes the degree-awarding powers. If we compare those relatively modest provisions with the genuine problems that face further education and the skills agenda that faces our country, the omissions are extraordinary.

Why have not we heard from the Secretary of State about what is really happening to apprenticeships? When the Chancelloror the Prime Minister electtalks about apprenticeships, he hopes that we think that he means an experienced, gnarled craftsman, wearing his blue overalls[Hon. Members: Or her.] Okay. I know that gender is a sensitive issue for the Secretary of State. The Chancellor expects us to envisage an experienced craftsman transmitting a body of knowledge that he has picked up over the years to a younger studentmale or femalewho wishes to learn 21 May 2007 : Column 1008
a craft. Sadly, that is not what apprenticeships as delivered by the Government mean. All too often, they mean being present at a further education college for a further education course, which may be valuable, but has insufficient employer involvement and sometimes too little practical work experience.

Mr. Jenkins:
The hon. Gentleman could help the House to understand the role of apprenticeships in this country because Conservative Members are undoubted experts on the matter. Will he tell us how they destroyed so many so that we can apply a reverse policy? He could help the nation in that way.

Mr. Willetts:
Starts in apprenticeships have reduced from 135,000 in 2004-05 to 123,000 in 2005-06. Advanced apprenticeships, which we might view as traditional apprenticeships, are also falling by a modest amount. Despite the rhetoric from the Chancellor about all the extra apprenticeships, starts in apprenticeships are declining under the Government.

However, the number of young people not in education, employment or trainingNEETsis increasing. When the Government came to office, 1,082,000 young people were not in education, employment or training. Despite the new deal and all the initiatives that the Government launched, the figure is now 1,240,000. When Ministers launched the new deal, I do not believe that they were prepared to settle for nearly 200,000 more young people out of education, employment and training. That is why they need radically to rethink their skills strategy, but I am afraid that they have not done that.

Let us consider diplomas. The other day, the Secretary of State famously said:

Things could go horribly wrong, particularly as we are keeping A-levels and GCSEs... there is a danger of the Diplomas becoming if you like the secondary modern compared to the grammar.

That is a live topic on both sides of the House. However, we still need to know what is happening to diplomas. It is clear from the Select Committee report, which was published last week, that there is much concern about whether diplomas can be delivered. It states:

Too often in the past, initiatives have been rolled out in a rushed manner, with negative consequences in terms of quality.

Again, that is the story of the Governmentrushing through ill-thought-out initiatives.

The Bill fails to implement the proposals in Sir Andrew Fosters report or in Lord Leitchs report, does not tackle the problem of the decline in apprenticeship starts, settles for an increasing number of young people not in education, employment or training and does not tackle growing concern about the diplomas. For those reasons, Conservative Members will vote for our reasoned amendment this evening.

5.19 pm

Mr. Paul Murphy (Torfaen) (Lab):
For the first time in 16 years, I rise to speak in the House on an education Bill. It is interesting that it coincides with the shadow Secretary of States comments about the inception of the incorporation of further education. I was a Member of the House when that was debated and discussed, and it was not such a noble birth. It 21 May 2007 : Column 1009
came about, of course, as a result of the chaos surrounding the poll tax. When all that collapsed, the Government wanted some money, so they brought in the concept of incorporation of further education. I would not reverse that decision and I am sure that my right hon. Friend the Secretary of State would not either, but that was the reason why FE was incorporated in the first instance.

I also speak as someone who taught in further education for nearly two decades. What astounds me about the comments of the shadow Secretary of State is how he fails to recognise some of the most important and significant statistics on FE. For example, 4 million peoplemore than all our sixth formers put togetherare benefiting from FE, almost half the entrants to higher education come from further education and almost 250,000 people over the age of 16 go into our FE institutions and benefit from the courses they provide. I remember being a young 22-year-old, know-it-all teacher, teaching European history to a 75-year-old woman who had lived through the period I was teaching. At the end of the year, I knew that I should not have been quite so arrogant.

I welcome the detailed provisions in the Bill. I shall not comment on the Learning and Skills Council for England, as it does not affect my constituents, but I would like to comment on degree-awarding powers. I agree that there is a need to ensure the proper quality of the degrees offered at FE colleges, and I am sure that when the Minister for Higher Education and Lifelong Learning winds up the debate, he will provide us with an assurance about that.

I am not quite so sure about the difficulties that some hon. Members have with the dismissal of principals. I would like to refer to an incident that occurred more than a decade ago in Wales. Members for what was then the county of Gwent got together because of the huge financial problems at Gwent college, which was moving into financial chaos and ruin. Those MPs instructed the National Audit Office to look into the problems and to let the then Secretary of State for Wales know about what had happened. The then Welsh Office, together with the governing body, decided between them that the principal had to go; otherwise the college would have gone from worse to worst. The important point is that in some areas of the country, FE colleges provide all the post-16 education, so unless there is a guarantee of proper management at the top of those colleges, the education of our post-16 youngstersand, indeed, the not-so-youngsters over 16could be greatly affected.

I know that the overwhelming majority of college principals are good men and women, but there will be some who are poor performers and their continued employment in that job will mean youngsters fail to benefit from further education in our constituencies. In those instances, the best way around the problem is for the Government to talk to the governing bodies in order to reach a decision jointly. There has to be an ultimate deterrent; otherwise the people who suffer will be the students attending those colleges.

Mr. Boswell:
I am following the right hon. Gentlemans argument with care and a great deal of sympathy. 21 May 2007 : Column 1010
Would he agree that, certainly at the time when I had some responsibility for further education in England, if there were a problem in a particular college, we could commission an in-depth investigation? In one case, I remember that an ex-permanent secretary at the Department was involved, who looked into the affairs of that college and made a report, following which, in conjunction with the governors, the necessary changes were made.

Mr. Murphy:
Yes, in most cases, that would be the answer. I suspect that the Minister will tell us that, ultimately, he needs some power in order to put into effect the results of any such investigation. I would hope that the matter would be dealt with in that way. It is wrong to assume that every principal in the country is excellentoccasionally there will be difficulties.

I also welcome the Bills attention to the skills in our country. Anyone who looks at the Republic of Ireland, for example, will see that that Celtic tiger, as it is known, has quite rightly become one of the most prosperousif not the most prosperousmember of the European Union because of the attention paid to further education there.

My main concern is about clause 25, which devolves to the National Assembly for Wales legislative powers relating to further education. Let me say straight away that I entirely agree with what the clause does. I am concerned, however, about the way in which we deal with the pre-legislative scrutiny of Bills and orders that give the National Assembly for Wales new legislative powers. Jane Davidson is the Minister for Lifelong Learning in Wales, and on 1 February this year, she made a speech in Cardiff welcoming the Bill. I repeat, therefore, that I have no problem with the principle of devolving the powers to the National Assembly.

However, in the debate on Second Reading and other debates on this issue in the other place, my noble Friend Lord Ted Rowlands made reference to the fact that this is not quite what was expected when the Government of Wales Bill was debated in this place. As a former Secretary of State for Wales, I took some time to speak in the debates on that legislation to ensure that this House gave proper scrutiny to any primary law-making powers that were to be devolved to the National Assembly.

I have asked a number of parliamentary questions on this issue. The Minister for Higher Education and Lifelong Learning told me in a written reply that: